Vol 4 Ed 4
Volume 4 Edition 4 Newsletter
FINANCIAL CARE SERVICES
Independent aged care, lifestyle and financial advice for seniors
Volume 4 Edition 4 –30 April 2014
Commonwealth Compensation Recovery Program
Did you know that the Commonwealth will reclaim any amounts expended when you receive a ‘sickness and accident’ income insurance benefit or compensation payments for accidents, illness or injury?
Centrelink, DVA and Medicare can require you to pay back their costs as part of your personal injury claim. Your injury or illness compensation claim should include components for reimbursing Medicare for your incurred medical costs and for your future medical and care costs. The Commonwealth could recoup the costs of long term care from your compensation payment.
Beware that any Injury, or Illness, Compensation Payments you receive for loss of earnings could impact your Centrelink Benefits. Centrelink have a responsibility to recoup any income support benefits that were overpaid because you later received a compensation payment or a ‘sickness or accident’ insurance payment. Long term Carer Payments, Disability Support Pensions and Age Pensions are impacted as well as the short term NewStart Sickness Benefits. Read more
Aged Care Regulation is changing on 1 July 2014
Last year the Commonwealth parliament passed the Aged Care (Living Longer Living Better) Bill 2013. The new legislation changes the administration and financing system for both residential aged care and aged care at home.
None of the changes would impact financially on people who are permanent residents of Commonwealth regulated aged care homes as at 30 June 2014.
Aged Care Accommodation Charges to be based on the value of the physical accommodation
As from July 2014, each Commonwealth regulated aged care facility must publish a ‘price list’ for the accommodation offered to new residents. The prices could be different for different styles of accommodation and/or individual rooms within the one facility.
For example, a twin share room with a basic fit out for immobile patients receiving high level nursing care might be priced at $200,000 per bed. In contrast, a spacious single room with its own en-suite bathroom, nicely furnished with quality carpets and window drapes, and with access to well-appointed communal lounge areas could be priced at $500,000.
The maximum Accommodation Price is expected to be set at $550,000 in July 2014. But individual aged care facilities may apply to the Aged Care Pricing Commissioner to allow a higher price for very superior accommodation.
Read more about the new Accommodation Charges for aged care
New Means Tested Daily Care Fees for Residential Aged Care
The Commonwealth aged care reform package, Living Longer Living Better, introduces a new style of means tested daily care fee.
All residents of Commonwealth regulated residential aged care facilities will continue to pay the Basic Daily Care fee. The Basic Daily Care Fee and the Accommodation Charges together could be just enough to cover the ‘hoteling’ costs of living in a residential aged care facility.
But most aged care residents require some personal support and possibly nursing care also. The Commonwealth pays a care subsidy in respect of the agreed level of personal support and nursing care for each individual resident.
Part of this care subsidy is recouped via the current system of ‘Income Tested Fees’ for residents in permanent care by 30 June 2014.
For new permanent residents after June 2014, the Care Subsidy will be reduced by the new means tested Daily Care Fee. The Commonwealth will continue to pay at least part of the costs of providing personal support and nursing care to each resident.
The amount of the means tested Daily Care Fee for an individual resident depends on the assessed value of her assets, her ‘income’ at Centrelink and the level of care that she is actually receiving. The amount of a resident’s new means tested Daily Care Fee is subject to an annual cap and a lifetime cap. The Commonwealth have not yet published the full set of caps and rates for calculating the means tested amounts.
The new fee system for Commonwealth regulated aged care is more complex for families to negotiate.
For example, any Accommodation Bond actually paid to an aged care facility will be counted as an asset of the resident for means testing Daily Care Fee purposes. The former home of an aged care resident will also be included in her assets for the means tested Daily Care Fee unless it is occupied by a partner or a Pensioner family member. Read more about July 2014 Means Tested Daily Care Fees for Commonwealth regulated residential aged care.
Families will be able to choose the style of aged care ‘hoteling’ and have choices regarding sale, leasing or just retention of the former home. But each choice regarding the former home and/or the new aged care the accommodation will impact on the maximum means tested fee.
Help is available. Financial Care Services offers consultation with families to Illustrate the financial implications of their choices of aged care placements.
A consultation before placing a loved one into permanent care could clarify the costs and check that the place is affordable before permanent entry is confirmed. Call Financial Care Services to book a consultation before you finalize an aged care placement.
Call Christine on 03 9808 0338 to book an appointment to discuss your aged care financing.
Financial Care Services Pty Ltd
Independent aged care, lifestyle and financial advice for seniors in Melbourne, Victoria, Australia
Australian Financial Services Licence Number
299570 (check this at www.search.asic.gov.au/fsr/flb.html)
Authorised Representative Number
252529 (check this at www.search.asic.gov.au/fsr/far.html)
Telephone – call +61 3 9808 0338
Email – contact firstname.lastname@example.org
Address – mail or meet at 172 Warrigal Road, Camberwell Victoria 3124
Website – visit www.financialcareservices.com.au
LinkedIn – connect www.linkedin.com/in/fincareservice
LinkedIn Company – follow www.linkedin.com/company/financial-care-services
LinkedIn Group – join www.linkedin.com/groups/Financial-Care-Services-4215797
Facebook Page – like www.facebook.com/fincareservice
Twitter Feed – follow www.twitter.com/fincareservice
Past newsletters – see http://www.financialcareservices.com.au/newsletters
Newsletter – subscribe http://eepurl.com/js41T
Disclaimer: The information contained in this newsletter is of a general nature only and does not constitute “financial advice”. You should obtain your own personal financial advice before investing any money or moving in to any retirement village, lifestyle community or aged care facility. Financial Care Services is licensed to provide financial advice to individual clients based on their personal situations.
© 2014 Financial Care Services Pty Ltd. All rights reserved.